New college football playoff could be worth $5 billion over 10 years

The world rejoiced yesterday as major college football finally installed a four team playoff after decades of resisting an evolution from the old bowl cartel system. Forget the fact that Divisions II and III have been doing playoffs for years without total and utter hypocrisy, we’re celebrating progress today! Don’t worry, major college football and all its benefactors and conspirators will still benefit greatly from this new playoff. As brilliantly explained yesterday by Dan Wetzel, this is a great day for college football fans, but it’s only window dressing on the institutional corruption of major college football. In order to truly enjoy the playoff, we have to keep our heads turned away from the same ol’ same ol’ NCAA. The same people that have profited off college football in the past will make even more money, they just needed the time to develop a system to ensure it with bowl games rotating as semifinal hosts and sites bidding for the title game each year.

A major source of revenue for the new playoff will be in the inevitable new television contract for the national semifinals and national championship game when the playoff launches in 2014. Matt Hayes at The Sporting News reports that new contract could cost a network $5 BILLION over 10 years, or $500 million per year, to broadcast the playoff.

The BCS Presidential Oversight Committee will vote Tuesday in Washington, D.C., on a new four-team, three-game playoff that could be sold to television for as much as $5 billion over a 10-year deal, a BCS source close to the process told Sporting News.

The 2011 BCS contract paid out $174 million, and the newly restructured postseason would nearly triple that number.

With that kind of cold, hard cash it’s amazing to think a playoff took this long to materialize.

To put that number in perspective, $500 million per year is still only a fourth of what ESPN pays the NFL for Monday Night Football. That $1.9 billion per year deal was a 73% increase from the last MNF contract. For the new playoff though, we’re talking about ginormous numbers. The $500 million is almost triple the old contract. To put that figure in further perspective, the NBA gets $930 million per year in its most recent deal with ESPN/Turner. MLB’s contracts are estimated around $900 million for its entire package.

As the current home of the BCS and with deep pockets, ESPN has to be the clear frontrunner to win rights to the college football playoff. Given the exclusive 30 day negotiating window for the next contract, ESPN will have the first crack at securing the playoff and televising it on its airwaves. However, the playoff has unknown potential. How much value will it really have five or ten years from now? With the exploding television sports rights in the last few years and the prospect of a juicy bidding war, college football execs may not settle for the first good offer from ESPN and see what Fox, NBC, and CBS would be willing to fork over. Whatever the final number turns out to be, it will be huge. After all, the decision to finally move to a playoff is all about the money. Like it always has been.